Spanish April Industrial Production Increases Most in Four YearsAngeline Benoit
Spanish industrial output rose the most in over four years in April, indicating Prime Minister Mariano Rajoy is on track to overcome a six-year slump in the euro region’s fourth-largest economy.
Production at factories, refineries and mines, about 16 percent of Spain’s output, increased 4.3 percent from a year earlier after adjusting for the number of working days and seasonal fluctuations, the National Statistics Institute in Madrid said in a statement today. That beats the 1.2 percent increase forecast in a Bloomberg News survey, according to the median of nine estimates.
Rajoy forecasts a 1.2 percent contraction in 2013 will give way to 1.2 percent growth this year, as a recovery in domestic demand adds to record exports. His government has pledged to cut taxes next year as he seeks to boost growth in the run up to next year’s general election with a quarter of the workforce still jobless. Rajoy implemented the toughest austerity measures in three decades after taking office in 2011.
“The number points to continued growth momentum,” Victor Echevarria, an economist at BNP Paribas SA in London, wrote in a note today. “Spanish industrial production will be supported by the euro area and the domestic recovery as Spain capitalizes on the competitiveness gains it achieved in the downturn.”
Juergen Stackmann, CEO of Seat, the Spanish division of Europe’s largest automaker Volkswagen AG, last month said the Spanish market is improving, helping a positive sales trend continue in May.
Spain’s recovery is continuing in the second three months of 2014 and is set to complete a fourth straight quarter of economic growth, the Bank of Spain said on May 28.